Boeing chief says massive layoff cycle is almost over

TOKYO — Boeing Co. is nearing the end of a series of layoffs in response to the worst downturn in commercial aviation "since airplanes existed," Chief Executive Philip M. Condit said Wednesday.

Condit was in Tokyo for events commemorating the 50th anniversary of the company's operations in Japan.

Chicago-based Boeing, the world's largest manufacturer of airliners, has been cutting jobs since the Sept. 11 terrorist attacks and has said it expects to reduce its employee head count by 35,000 by the end of this year.

Condit said Boeing was "just shy" of that figure and that not many more positions would be lost, as the company's commercial aircraft division has decreased production by about half.

"There will be some more [layoffs] ahead but not many," he said. "We are virtually on those low production rates now."

He did not elaborate on whether that meant there would be job cuts beyond the 35,000 previously announced.

Condit said Boeing's delivery target of about 280 airliners this year "looks very firm" despite the unprecedented impact on the travel industry of Sept. 11, the war in Iraq and the outbreak of severe acute respiratory syndrome.

"It is the worst downturn since airplanes existed," he said. "The impact has been on every airline in the world."

Boeing and its biggest rival, Airbus SAS, have been hurt as carriers around the world cut flights and park planes because the outbreak of SARS has exacerbated a fall in travel.

Boeing had the outlook on its credit quality changed to negative from stable last week by Moody's Investors Service because airlines may delay or cancel orders.

Condit said Boeing stands by its forecast to deliver between 275 and 300 commercial jets in 2004, adding that the only significant unknown was how long SARS will discourage travelers.

Still, the figures for 2003 and 2004 would be the lowest for Boeing since 1996, when it delivered 271 jets.

Condit said the tough times for the travel industry had vindicated Boeing's strategy in recent years of building its defense-related business through acquisitions.

Last year, 53 percent of Boeing's revenue came from commercial aircraft and 47 percent from defense. That ratio will reverse this year, he said.